Unclaimed insurance benefits for migrant workers in Korea hit record 32.3 billion won

More than 32 billion won ($24 million) in insurance benefits owed to migrant workers in Korea remained unclaimed as of the end of June, the largest amount on record, government data showed Monday.

The outstanding balance totaled 32.36 billion won across 54,572 cases, up 1.6 billion won from 30.76 billion won a year earlier, according to Labor Ministry data obtained by Rep. Park Hae-cheol of the Democratic Party of Korea.

“Efforts to help migrant workers recover dormant benefits should be expanded so that they do not miss insurance payments they are rightfully entitled to,” Park said. “We must also devise ways to use the remaining dormant funds.”

The money comes from two mandatory insurance programs for migrant workers employed under Korea’s Employment Permit System.

Benefits left unclaimed for three years are classified as dormant and transferred to the Human Resources Development Service of Korea, which continues to identify and pay eligible recipients.

By the end of June, a cumulative 57.89 billion won in benefits had been transferred to the agency, including 20.91 billion won from Departure Guarantee Insurance and 36.98 billion won from Return Cost Insurance.

The agency has returned 25.53 billion won through its dormant-benefit recovery campaign, leaving 32.36 billion won unclaimed.

The growing balance comes as Korea’s migrant workforce and the number of insurance payments have expanded.

Last year, payments were made in 113,483 Departure Guarantee Insurance cases, totaling 457.4 billion won. The number of payments was up 69.6 percent from 66,908 in 2021.

Return Cost Insurance payments rose 28 percent over the same period, from 39,427 cases to 50,482. They totaled 24.5 billion won last year.

Departure Guarantee Insurance is a mandatory policy purchased by employers to secure severance payments for migrant workers. Return Cost Insurance is purchased by workers to cover expenses associated with returning to their home countries.

Under the Act on the Employment of Foreign Workers, workers with nonprofessional employment visas (E-9) and eligible workers with working visit visas (or H-2) must purchase Return Cost Insurance.

Their employers are required to purchase Departure Guarantee Insurance.

Workers can generally claim the benefits when they permanently leave Korea, reach the end of their permitted stay or change to a visa status not covered by the programs.